Working with a Financial Advisor: Things to Know

10/23/2018

The world of 50 years ago was a lot different than it is today. An individual often worked at the same job all his or her adult life, lived in the same house, and stayed married to the same spouse. In those days, too, one spouse could support a family, paying for college ordinarily didn't require taking out a second mortgage, and people could look forward to retiring on Social Security and possibly a company pension.

Today, your hopes and dreams are no different. Like most people, you probably want to buy a home, put your children through college, and retire with a comfortable income. But the world has become a more complex place, especially when it comes to your finances. You may already be working with financial professionals—an accountant or estate planner, for example—each of whom advises you in a specific area. But if you would like a comprehensive financial plan to help you secure your future, you may benefit from the knowledge of a financial advisor.

Services a financial advisor may provide

Even if you feel competent enough to develop a plan of your own, a financial advisor can act as a sounding board for your ideas and help you focus on your goals, using his or her broad knowledge and skills in specific areas such as estate planning and investments.

A financial advisor can be a partner in your financial journey, supporting you with decision-making and investment advice, while helping you build your confidence in your own ability to manage your money. He or she can help you see the big picture and help get you started in the whole process, or meet you where you can fine-tune your current plan to better fit your short- and long-term goals.

Specifically, a financial advisor may help you:

Set financial goals

Determine the state of your current financial affairs

Develop a plan to help meet your financial goals which addresses your current financial weaknesses and builds on your financial strengths

How are financial advisors compensated?

Salary based--You pay the company for which the advisor works, and the company pays its advisors a salary

Fee based--You pay a fee based on an hourly rate (for specific advice or a financial plan), or based on a percentage of your assets and/or income

Commission based--The advisor receives a commission from a third party for any products you may purchase

Commission and fee based--The advisor receives both commissions and fees

You'll need to decide which type of compensation structure works best for you, based on your own personal circumstances.

When is it time to consult a financial advisor?

Getting married or divorced

Having a baby or adopting a child

Paying for your child's college education

Buying or selling a family business

Changing jobs or careers

Planning for your retirement

Developing an estate plan

Coping with the death of your spouse

Receiving an inheritance or a financial windfall

In these situations, a financial professional can help you make objective, rather than emotional, decisions.

However, you don't have to wait until an event occurs before you consult a financial advisor. A Farm Bureau financial advisor can help you develop an overall strategy for approaching your financial goals that not only anticipates what you'll need to do to reach them, but also remains flexible enough to accommodate your evolving financial needs.

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